EXHIBIT 10.12
GUARANTY OF ▇▇▇▇▇▇
THIS GUARANTY OF ▇▇▇▇▇▇, (the "Guaranty") dated this 27th day of March,
2002 is executed and delivered by undersigned ("Guarantor") in favor of LASALLE
BANK NATIONAL ASSOCIATION, a national banking association, as Administrative
Agent ("Agent") pursuant to the terms of the Loan Agreement (hereinafter
defined).
W I T N E S S E T H:
WHEREAS, TALX Corporation, a Missouri corporation ("Borrower") has
obtained, or is about to obtain, an Aggregate Commitment pursuant to that
certain Loan Agreement (as may be amended, restated or modified from time to
time, the "Loan Agreement") of even date herewith by and among Borrower, Agent,
individually and as Administrative Agent and Southwest Bank of St. Louis
(collectively Agent, individually, and Southwest Bank of St. Louis are referred
to herein as "Lenders") pursuant to which loans made by Lenders to Borrower
thereunder (each a "Loan" and collectively "Loans") are evidenced by certain
Revolving Note(s) and Term Note(s) of the Borrower all of even date herewith
which together aggregate in the principal amount of up to Forty Million Dollars
($40,000,000.00) and which are all due and payable at the times and pursuant to
the terms and conditions of the Loan Agreement (all such Revolving Note(s) and
Term Note(s) are referred to collectively herein as the "Notes"). The term "Loan
Documents" and all other capitalized terms used herein and not defined herein
have the meanings given to them in the Loan Agreement;
WHEREAS, Guarantor entered into that certain Asset Purchase Agreement
("APA") dated March 27, 2002 with Gates, ▇▇▇▇▇▇▇▇ & Company, an Ohio corporation
("Seller") pursuant to which Guarantor purchased certain assets of Seller for
the provision of workers' and unemployment compensation and cost control
services and other related services (such assets are commonly known as the
Unemployment Compensation Business Services Group ("UCBSG"));
WHEREAS, Lenders and Borrower have agreed to allow Borrower to provide
certain portions of the proceeds from the Loans to Guarantor in order to enable
Guarantor to fulfill Guarantor's purchase obligations under the APA;
WHEREAS, Guarantor acknowledges that certain portions of the purchase
money used in acquiring UCBSG are derived from the proceeds of the Loans and
that such portions have been delivered to the Guarantor for such purpose;
WHEREAS, Guarantor is desirous of having Lenders make and/or continue
to make Loans to Borrower which will inure to the direct and indirect financial
benefit of Guarantor and Guarantor further acknowledges that as a condition
precedent to Lenders entering in the Loan Agreement and making such Loans to
Borrower, Lenders require Guarantor to execute and deliver this Guaranty in
favor of Agent for the ratable benefit of the Lenders; and
WHEREAS, this Guaranty is to be secured by, inter alia, a Security
Agreement of even date herewith executed by Guarantor, reference to which is
made for the rights of the Agent for the ratable benefit of the Lenders to
accelerate the maturity of the Notes or Obligations
(hereinafter defined) guaranteed hereby, and Guarantor, by execution of this
Guaranty, hereby acknowledges receipt of copies of all Loan Documents and
represents it has read and understands such Loan Documents.
NOW, THEREFORE, in consideration of the execution and delivery by the
Lenders of the Loan Agreement and the direct delivery of certain portions of the
Loans to Guarantor for Guarantors use in acquiring UCBSG, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged by the Guarantor, the Guarantor hereby agrees with the Agent as
follows:
1. ABSOLUTE GUARANTY. The Guarantor unconditionally, absolutely, and
irrevocably guarantees, for the ratable benefit of Lenders and for the ratable
benefit of each and every present and future holder or holders of the Notes (all
herein called the "Lender"), the full and prompt payment to the Lender at
maturity (whether at the stated maturities thereof, or by acceleration or
otherwise) of the present or future indebtedness of the Borrower evidenced by
the Loan Agreement and the Notes, together with all other present or future
obligations and liabilities of the Borrower under and pursuant to the Loan
Documents as the same or any thereof may from time to time be amended, restated
and modified (all of which indebtedness, obligations and liabilities being
herein called the "Indebtedness Hereby Guaranteed") and the full and prompt
performance and observance by the Borrower of all of the warranties, covenants
and agreements provided by the Loan Documents to be performed and observed by
the Borrower (herein called the "Obligations"); and to this end the Guarantor
covenants and agrees to take all such actions necessary to enable the Borrower
to observe and perform and to refrain from taking any action which would prevent
the Borrower from observing and performing each and every Obligation.
2. CONTINUING GUARANTY. This Guaranty shall be a continuing guaranty,
shall be binding upon the Guarantor, its successors and assigns, and shall
remain in full force and effect, and shall not be discharged, impaired or
affected by (a) the existence or continuance of any obligation on the part of
the Borrower on or with respect to the Indebtedness Hereby Guaranteed, or any
Obligation under the Loan Documents; (b) the power or authority (or any lack
thereof) of the Borrower to issue the Notes or to execute, acknowledge or
deliver any other Loan Document; (c) the validity or invalidity of the Notes or
any other Loan Document; (d) any defense whatsoever that the Borrower may or
might have to the payment of the Indebtedness Hereby Guaranteed or to the
performance or observance of any of the terms, provisions, covenants and
agreements contained in the Notes or other Loan Documents; (e) any limitation or
exculpation of liability on the part of the Borrower; (f) the dissolution of the
Borrower; (g) the transfer by the Borrower of all or any part of the property
referred to in the Loan Documents to any other corporation, person or entity;
(h) any sale, pledge, surrender, indulgence, alteration, substitution, exchange,
change in, additions to, renewals of, extension, modification or other
disposition of any of the Indebtedness Hereby Guaranteed, or any of the
Obligations, all of which the Lender is hereby expressly authorized to make from
time to time without notice to the Guarantor, or to anyone; (i) the acceptance
by the Lender of any security for, or other guarantors upon, all or any part of
the Indebtedness Hereby Guaranteed or Obligations; (j) any failure, neglect or
omission on the part of the Lender to realize or protect any of the Indebtedness
Hereby Guaranteed or any collateral or security therefor, or to exercise any
lien upon or right or
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appropriation of any moneys, credits or property of the Borrower toward the
liquidation of the Indebtedness Hereby Guaranteed or any application of payments
or credits thereon; (k) any right, claim or offset which Guarantor may have
against the Borrower; or (l) any defense (other than the payment of the
Indebtedness Hereby Guaranteed and performance of the Obligations, in accordance
with its terms) that the Guarantor may or might have to its respective
undertakings, liabilities and obligations hereunder, each and every such defense
being hereby waived by the Guarantor; it being understood and agreed that this
Guaranty, and the undertakings, liabilities and obligations of the Guarantor
hereunder shall not be affected, discharged, impaired or varied by any act,
omission or circumstance whatsoever (whether or not specifically enumerated
above) except the due and punctual payment of the Indebtedness Hereby Guaranteed
and performance of the Obligations, and then only to the extent thereof; or (m)
any understanding or agreement that any other person, firm or corporation was or
is to execute this Guaranty or the Notes or any of the Loan Documents.
3. NO OBLIGATION TO PROCEED AGAINST BORROWER. The Lender shall have the
exclusive right to determine how, when and what application of payments and
credits, if any, shall be made on the Indebtedness Hereby Guaranteed or the
Obligations, or any part thereof; and in order to hold the Guarantor liable
hereunder there shall be no obligation on the part of the Lender, or anyone, at
any time, to proceed against the Borrower, its properties or estates, or any one
of them, or to proceed against any other guarantors, or to resort to any
collateral, security, property, liens, or other rights or remedies whatsoever.
4. BANKRUPTCY OF GUARANTOR. The bankruptcy of Guarantor shall not
terminate this Guaranty, whether or not a claim against the estate of such
bankrupt Guarantor is made, and shall not terminate this Guaranty as to the
estate of the bankrupt Guarantor.
5. NO OBLIGATION TO PROCEED AGAINST ANY GUARANTOR. The Lender shall
have the right to enforce this Guaranty against Guarantor for and to the full
amount of the Indebtedness Hereby Guaranteed, with or without enforcing or
attempting to enforce the Loan Documents against Borrower or any other guaranty
against any other guarantor, or any security for the obligation of any of them,
and whether or not proceedings or steps are pending or have been taken or have
been concluded to enforce or otherwise realize upon the obligation or security
of the Borrower or any other guarantor, or any of them; and the payment of any
amount or amounts by Guarantor, pursuant to its obligations hereunder, shall not
in any way entitle such Guarantor, either at law, in equity, or otherwise, to
any right, title, or interest (whether by way of subrogation or otherwise) in
and to any of the Indebtedness Hereby Guaranteed, or any principal or interest
payments theretofore, then, or thereafter at any time made by the Borrower or
any other guarantor, or any of them, on the Indebtedness Hereby Guaranteed, or
made by anyone on behalf of the Borrower, or in and to any security therefor,
unless and until the full amount of the Indebtedness Hereby Guaranteed has been
fully paid.
6. TIME OF ESSENCE. Time is of the essence of this Guaranty and of the
performance of each term, covenant and provision hereof.
7. WAIVER OF NOTICE. All diligence in collection or protection, and all
presentment, demand, protest and/or notice of dishonor, protest, and of default
and of non-payment and of the creation and existence of any and all of the
Indebtedness Hereby Guaranteed
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or of performance or non-performance of any Obligation, and of any security and
collateral therefor, and of the acceptance of this Guaranty, and of any and all
extensions of credit and indulgence hereunder, are expressly waived by the
Guarantor.
8. TRANSFER OF DEBT BY LENDER. The Lender may, without any notice
whatsoever to anyone, sell, assign, or transfer all or any part of the
Indebtedness Hereby Guaranteed, or grant participations in the Indebtedness
Hereby Guaranteed, and in any and every such event, each and every immediate and
successive assignee, transferee, holder of or participant in all or any part of
the Indebtedness Hereby Guaranteed shall have the right to enforce this Guaranty
by suit or otherwise, for the benefit of such assignee, transferee, holder or
participant, as fully as if such assignee, transferee, holder or participant
were herein by name specifically given such rights, powers, and benefits.
9. SUCCESSORS AND ASSIGNS. This Guaranty, and each and every part
hereof, shall be binding upon the Guarantor, successors and assigns of
Guarantor, and shall inure to the pro rata benefit of each and every future
holder of the Notes or any interest in the Indebtedness Hereby Guaranteed
pursuant to the terms of the Loan Agreement.
10. DELIVERY OF NOTE. The delivery of the Notes or any other promissory
note evidencing the Indebtedness Hereby Guaranteed for value to any person
shall, without more, constitute conclusive evidence of the acceptance hereof,
and of the reliance hereon by each and every from time to time holder of the
Note or any interest in the Indebtedness Hereby Guaranteed.
11. MASCULINE, FEMININE, PLURAL. As used herein, the masculine gender
shall include the feminine, and the singular case shall include the plural and
the plural the singular, wherever the same may be applicable.
12. BANKRUPTCY OF BORROWER. Notwithstanding any modification,
discharge, or extension of the Indebtedness Hereby Guaranteed or any amendment,
modification, stay or cure of the Lender's rights under the Notes, or other Loan
Documents which may occur in any bankruptcy or reorganization case or proceeding
affecting the Borrower, whether permanent or temporary, and whether or not
assented to by the Lender, the Guarantor hereby agrees that it shall be
obligated hereunder to pay the Indebtedness Hereby Guaranteed and discharge the
other Obligations in accordance with the terms of the Notes, and other Loan
Documents and the terms of this Guaranty as in effect on the date hereof.
Guarantor understands and acknowledges that by virtue of this Guaranty
it has specifically assumed any and all risks of a bankruptcy or reorganization
case or proceeding affecting the Borrower; and, as an example and not by way of
limitation, a subsequent modification of the Notes in any reorganization case
concerning the Borrower shall not affect the obligation of the Guarantor to pay
the indebtedness evidenced by the Note and all other Indebtedness Hereby
Guaranteed in accordance with its original terms.
13. RETURN OF PAYMENT. Guarantor hereby agrees that if at any time all
or any part of any payment theretofore applied by Lender to any Indebtedness
Hereby Guaranteed is rescinded or returned by Lender for any reason whatsoever
(including, without limitation, the
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insolvency, bankruptcy, liquidation or reorganization of any party), the
Indebtedness Hereby Guaranteed shall, for the purposes of this Guaranty, be
deemed to have continued in existence to the extent of such payment,
notwithstanding such application by Lender, and this Guaranty shall continue to
be effective or be reinstated, as the case may be, as to the Indebtedness Hereby
Guaranteed, all as though such application by Lender had not been made.
14. COSTS AND EXPENSES. In addition to all other amounts payable by
Guarantor hereunder, Guarantor hereby agrees to pay to Lender upon demand any
and all costs and expenses, including court costs and reasonable attorney's fees
which the Lender may incur (a) in enforcing the obligations of the Guarantor
hereunder; or (b) in preparing to collect or enforce the Indebtedness Hereby
Guaranteed and the Obligations or in collecting or enforcing the same, in each
case whether or not suit or action is filed.
15. PARTIAL INVALIDITY. If any term of this Guaranty, or the
application thereof to a person or circumstance, shall to any extent be declared
invalid or unenforceable, the remainder of this Guaranty, or the application of
such term, to persons or circumstances other than those to which it is invalid
or unenforceable shall not be affected thereby and each term of this Guaranty
shall remain valid and enforceable to the fullest extent permitted by applicable
law. Notwithstanding anything in this Guaranty to the contrary, the right to
recover against the Guarantor under this Guaranty shall not exceed $1 less than
the amount which would render any of the Guarantor's obligations under this
Guaranty void or voidable under applicable law, including fraudulent conveyance
law.
16. ASSIGNMENT OF GUARANTY. Lender may without prior notice assign this
Guaranty in whole or in part but shall notify Guarantor after such assignment.
17. SETOFF. In addition to all liens upon, and rights of setoff against
the moneys, securities, or other property of Guarantor given to Lender by law,
Lender shall have a lien upon and a right of setoff against all moneys,
securities, and other property of Guarantor now or hereafter in the possession
of or on deposit with Lender, whether held in a general or special account or
deposit, or for safekeeping or otherwise; and every such lien and right of
setoff may be exercised so long as there is an Existing Default under the Loan
Agreement without demand upon or notice to Guarantor. No lien or right of setoff
shall be deemed to have been waived by any act or conduct on the part of Lender,
or by any neglect to exercise such right of setoff or to enforce such lien, or
by any delay in so doing, and every right of setoff and lien shall continue in
full force and effect until such right of setoff or lien is specifically waived
or released by an instrument in writing executed by Lender.
18. SUBORDINATION OF DEBT OF BORROWER. Any indebtedness of Borrower now
or hereafter held by Guarantor, whether secured or unsecured, and if secured,
the security for same, is hereby subordinated to the indebtedness of Borrower to
Lender; and, so long as there is an Existing Default under the Loan Agreement,
such indebtedness of Borrower to Guarantor shall be collected, enforced, and
received by Guarantor as trustee for Lenders and be paid over to Lenders on
account of the indebtedness of Borrower to Lenders but without reducing or
affecting in any manner the liability of Guarantor under the other provisions of
this Guaranty.
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19. AUTHORIZATION OF BORROWER'S DEBT. It is not necessary for Lender to
inquire into the authority or powers of Borrower or the officers, directors,
partners, or agents acting or purporting to act on Borrower's behalf, and any
indebtedness made or created in reliance upon the professed exercise of such
powers shall be guaranteed hereunder.
20. GOVERNING LAW; NO THIRD PARTY RIGHTS. This Guaranty is to be
governed by and construed and interpreted in accordance with the internal Laws
of the State of Illinois applicable to contracts made and to be performed wholly
within such state, without regard to choice or conflicts of law principles. This
Guaranty is solely for the benefit of the Guarantor and Agent and the Lenders
and their respective successors and assigns pursuant to the terms of the Loan
Agreement, and no other person has any right, benefit, priority or interest
under, or because of the existence of, this Guaranty.
21. WAIVER OF DEFENSES. Guarantor does hereby expressly waive any and
all rights, remedies, benefits, or defenses which might otherwise be available
to a guarantor or surety under the laws of the State of Illinois, and any
defense based upon a claim that Lender's demands or claims against the
undersigned are not compensable because the fair market value of the security
for the Indebtedness Hereby Guaranteed, in its state of completion as of the
date of such demands or claims, was at least equal to the Indebtedness Hereby
Guaranteed.
22. INCONSISTENCY. To the extent the provisions of this Guaranty
conflict with the provisions of the Loan Agreement, the Loan Agreement shall
govern.
23. HEADINGS. The headings of this Guaranty are inserted for
convenience of reference only and shall not be applied in construing the
provisions of this Guaranty.
24. JOINT AND SEVERAL. The agreements, obligations, warranties and
representations or Guarantor hereunder are joint and several if Guarantor is
more than one person or entity, and are independent of the obligations of
Borrower.
25. CUMULATIVE REMEDIES. The rights and remedies herein provided are
cumulative and may be exercised singly or concurrently, and are not exclusive of
any rights or remedies provided by law.
26. CHOICE OF FORUM. SUBJECT ONLY TO THE EXCEPTION IN THE NEXT
SENTENCE, GUARANTOR AND AGENT HEREBY AGREE TO THE EXCLUSIVE JURISDICTION OF THE
FEDERAL COURT OF THE NORTHERN DISTRICT OF ILLINOIS AND THE STATE COURTS OF
ILLINOIS LOCATED IN ▇▇▇▇ COUNTY AND WAIVES ANY OBJECTION BASED ON VENUE OR FORUM
NON CONVENIENS WITH RESPECT TO ANY ACTION INSTITUTED THEREIN, AND AGREES THAT
ANY DISPUTE CONCERNING THE RELATIONSHIP BETWEEN AGENT AND GUARANTOR OR THE
CONDUCT OF ANY OF THEM IN CONNECTION WITH THIS GUARANTY OR OTHERWISE SHALL BE
HEARD ONLY IN THE COURTS DESCRIBED ABOVE. NOTWITHSTANDING THE FOREGOING: (1)
AGENT SHALL HAVE THE RIGHT TO BRING ANY ACTION OR PROCEEDING AGAINST GUARANTOR
OR ITS PROPERTY IN ANY COURTS OF ANY OTHER JURISDICTION DEEMED NECESSARY OR
APPROPRIATE IN ORDER
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TO REALIZE ON THE COLLATERAL, OR OTHER SECURITY FOR THE LOAN OBLIGATIONS, AND
(2) GUARANTOR AND AGENT ACKNOWLEDGE THAT ANY APPEALS FROM THE COURTS DESCRIBED
IN THE IMMEDIATELY PRECEDING SENTENCE MAY HAVE TO BE HEARD BY A COURT LOCATED
OUTSIDE THOSE JURISDICTIONS.
27. WAIVER OF JURY TRIAL. GUARANTOR AND AGENT HEREBY WAIVE ANY RIGHT TO
TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION (1) ARISING UNDER
THIS GUARANTY OR ANY OTHER LOAN DOCUMENT, OR (2) IN ANY WAY CONNECTED WITH OR
RELATED OR INCIDENTAL TO THE DEALINGS OF THE GUARANTOR AND AGENT OR EITHER OF
THEM IN RESPECT OF THIS GUARANTY OR ANY OTHER LOAN DOCUMENT, OR THE TRANSACTIONS
RELATED HERETO OR THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER
ARISING, AND WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE. GUARANTOR AND
AGENT AGREE AND CONSENT THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION
SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY AND THAT EITHER MAY FILE AN
ORIGINAL COUNTERPART OR A COPY OF THIS GUARANTY WITH ANY COURT AS WRITTEN
EVIDENCE OF THE CONSENT OF THE GUARANTOR OR AGENT TO THE WAIVER OF THEIR RIGHT
TO TRIAL BY JURY.
28. SERVICE OF PROCESS. GUARANTOR HEREBY WAIVES PERSONAL SERVICE OF ANY
AND ALL PROCESS UPON IT AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS MAY BE
MADE BY REGISTERED MAIL (RETURN RECEIPT REQUESTED) DIRECTED TO GUARANTOR AT ITS
ADDRESS SET FORTH ON THE SIGNATURE PAGE HERETO, AND SERVICE SO MADE SHALL BE
DEEMED TO BE COMPLETED FIVE (5) DAYS AFTER THE SAME SHALL HAVE BEEN SO DEPOSITED
IN THE U.S. MAILS; OR AT AGENT'S OPTION, BY SERVICE UPON CT CORPORATION, WHICH
GUARANTOR IRREVOCABLY APPOINTS AS GUARANTOR'S AGENT FOR THE PURPOSE OF ACCEPTING
SERVICE OF PROCESS WITHIN THE STATE OF ILLINOIS. AGENT SHALL PROMPTLY FORWARD BY
REGISTERED MAIL ANY PROCESS SO SERVED UPON SAID AGENT TO GUARANTOR AT ITS
ADDRESS ON THE SIGNATURE PAGES HERETO. NOTHING IN THIS SECTION SHALL AFFECT THE
RIGHT OF AGENT TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.
IN WITNESS WHEREOF, the Guarantor has signed and sealed this Guaranty
on the day and year first written above.
▇▇▇▇▇▇ ACQUISITION SUB, INC.,
a Missouri corporation
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Title: President
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WITH A NOTICE ADDRESS OF:
▇▇▇▇ ▇▇▇▇▇▇ ▇▇.
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▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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Attn: L. ▇▇▇▇▇ ▇▇▇▇▇▇
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AND COPY TO:
▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
▇▇▇▇▇ ▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
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